I upgraded to Parallels Desktop 7 for Mac and created a new Lion virtual machine from the recovery partition. I installed the Parallels Tools. All works great except when my host Mac goes to sleep. The Lion VM seems unable to recover from this. I seem to be able to move the VM's mouse, but I cannot click anything, pull down any menus or show the dock. If Parallels Desktop 7 for Mac can't recover from the host sleeping and awakening, it isn't ready for public distribution.